Earnings Miss: BAIC Motor Corporation Limited Missed EPS By 72% And Analysts Are Revising Their Forecasts

BAIC Motor Corporation Limited (HKG:1958) shareholders are probably feeling a little disappointed, since its shares fell 7.4% to HK$2.01 in the week after its latest yearly results. Revenue of CN¥192b surpassed estimates by 2.0%, although statutory earnings per share missed badly, coming in 72% below expectations at CN¥0.12 per share. The analysts typically update their forecasts at each earnings report, and we can judge from their estimates whether their view of the company has changed or if there are any new concerns to be aware of. With this in mind, we've gathered the latest statutory forecasts to see what the analysts are expecting for next year.

Following last week's earnings report, BAIC Motor's seven analysts are forecasting 2025 revenues to be CN¥189.4b, approximately in line with the last 12 months. Per-share earnings are expected to soar 120% to CN¥0.26. Yet prior to the latest earnings, the analysts had been anticipated revenues of CN¥181.6b and earnings per share (EPS) of CN¥0.39 in 2025. While next year's revenue estimates increased, there was also a pretty serious reduction to EPS expectations, suggesting the consensus has a bit of a mixed view of these results.

Check out our latest analysis for BAIC Motor

There's been no major changes to the price target of HK$2.03, suggesting that the impact of higher forecast revenue and lower earnings won't result in a meaningful change to the business' valuation. It could also be instructive to look at the range of analyst estimates, to evaluate how different the outlier opinions are from the mean. The most optimistic BAIC Motor analyst has a price target of HK$2.52 per share, while the most pessimistic values it at HK$1.39. There are definitely some different views on the stock, but the range of estimates is not wide enough as to imply that the situation is unforecastable, in our view.

Of course, another way to look at these forecasts is to place them into context against the industry itself. These estimates imply that revenue is expected to slow, with a forecast annualised decline of 1.6% by the end of 2025. This indicates a significant reduction from annual growth of 3.3% over the last five years. Compare this with our data, which suggests that other companies in the same industry are, in aggregate, expected to see their revenue grow 13% per year. So although its revenues are forecast to shrink, this cloud does not come with a silver lining - BAIC Motor is expected to lag the wider industry.

The Bottom Line

The biggest concern is that the analysts reduced their earnings per share estimates, suggesting business headwinds could lay ahead for BAIC Motor. Fortunately, they also upgraded their revenue estimates, although our data indicates it is expected to perform worse than the wider industry. The consensus price target held steady at HK$2.03, with the latest estimates not enough to have an impact on their price targets.

Keeping that in mind, we still think that the longer term trajectory of the business is much more important for investors to consider. We have estimates - from multiple BAIC Motor analysts - going out to 2027, and you can see them free on our platform here.

You still need to take note of risks, for example - BAIC Motor has 1 warning sign we think you should be aware of.

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This article by Simply Wall St is general in nature. We provide commentary based on historical data and analyst forecasts only using an unbiased methodology and our articles are not intended to be financial advice. It does not constitute a recommendation to buy or sell any stock, and does not take account of your objectives, or your financial situation. We aim to bring you long-term focused analysis driven by fundamental data. Note that our analysis may not factor in the latest price-sensitive company announcements or qualitative material. Simply Wall St has no position in any stocks mentioned.